In Pursuit of the Eradication of Poverty: UBI in the era of COVID-19
The economic repercussions of the COVID-19 pandemic are far-reaching — ravaging families, businesses, and communities across the country. As practically 100% of small businesses, charities, and nonprofits nationwide have been affected by the pandemic, millions of individuals and families are left in financial ruin. The present remedies provided by the government will do nothing for the millions of Americans who are living paycheck-to-paycheck. The most effective way to provide immediate relief to people most impacted by COVID-19 is to put money into people’s hands.
Before the COVID-19 pandemic ravaged our communities, there was support of a Universal Basic Income by prominent figures and organizations — such as Professor Robert Reich, Andrew Yang, and 302 members of UC Berkeley’s Forward club — to combat job losses due to automation. Instead of automation, it was a global disaster, which has inarguably destroyed our economy on a massive scale. However, we must not forget that these “disasters” occur every moment of our lives: someone could lose their job, get evicted, get sick, or not be able to pay an unexpected bill. Moreover, we live in a society in which 59% of Americans cannot pay an unexpected $400 bill. Besides this mindset of scarcity, we struggle with time, empathy, money, and mental health in some form or another; these struggles are the most pervasive problems of our era. Notably, we live in a time in which many of our social safety nets should solve many of these problems, but our mental health is declining, suicides and drug overdoses are increasing, and income inequality is at an all-time high. UBI would provide that financial safety net so many people desperately needed.
As the coronavirus continues to wreak havoc on the very fabric of our society, our unemployment infrastructure is being overwhelmed. Over 30 million Americans have filed for unemployment since March. Now, how much help will all these people really receive? The coronavirus pandemic has revealed the inadequacies of our political and economic infrastructure.
Even before the COVID-19 era, our welfare system was not effective. There were still over 38.1 million Americans who live in poverty. For example, current social safety nets, such as Temporary Assistance for Needy Families (TANF) does an extremely poor job of reducing poverty. According to a 2019 study, in no single state does TANF provide the benefits of even half the poverty level. What’s more, the racial inequities with the states’ use of funds accounted for 15 percent of the black-white child poverty gap. In other words, our current safety net does not protect our most vulnerable populations.
Why is UBI over our current welfare system? Speed, universality, and security. First, speed because if you give money directly to people’s hands, you’re giving money directly to people’s hands. And there’s no time whatsoever being wasted on bureaucracy. Secondly, universality — or lack of means-testing — ensures that everyone is included and no one is excluded. In other words, anyone who needs help will get help. Lastly, security. People need security in order to thrive, and UBI provides that economic foundation. Although it is not an end all be all solution for everything, it’s a start — a start toward equalizing the playing field among the have and the have-nots.
Policymakers around the world are acknowledging the importance of emergency UBI in this crisis, but they’re ignoring the impact that UBI would have in normal times. In addition to protecting those left behind by our welfare system, UBI would produce economic growth by directly giving people money to spend. According to a study by the Roosevelt Institute, a UBI would grow the GDP by 2.5 trillion because when people are given direct cash, they will inject the money directly into their communities. A temporary UBI will be needed during this time of the pandemic to combat the looming recession, but a permanent one will be needed to ensure that every single American can have the opportunity to thrive.
The fight for Universal Basic Income will continue to live on, but the pandemic opened a door, which gave us a glimpse into the vast inequities of our current safety net system. We need UBI to ensure that everyone has financial security no matter what and to provide everyone an economic foundation — and hopefully one day, we will say with confidence: we eradicated poverty.
